MENU

Be Prepared For Unilever plc’s Upcoming Results

Unilever (LSE: ULVR) (NYSE: UL.US) is due to announce its annual results on Tuesday next week (21 January).

At the time of writing, the shares of the consumer-goods giant are trading at 2,402p – barely changed from a year ago, versus a 10% rise for the FTSE 100.

How will Unilever’s business have performed in 2013 compared with 2012? And will the results validate the weak performance of the shares? Here’s your cut-out-and-check results table!

  FY 2012 Forecast
FY 2013
Forecast
FY growth
Turnover €51.32bn €50.42bn -1.8%
Core operating profit €7.06bn €7.06bn 0%
Core operating margin 13.8% 14.0% +0.2%
Core earnings per share (EPS) – diluted €1.53 €1.53 0%
Dividend per share €0.972 €1.076 +10.7%

Analysts are forecasting a 1.8% drop in Unilever’s turnover. However, that’s not as poor as it appears on first sight because the analysts believe adverse currency movements have had a sizeable 5% negative impact, with acquisitions and disposals responsible for a further -0.9%.

Look out for underlying sales growth — turnover at constant exchange rates, excluding the effects of acquisitions and disposals — of +4.2%.

Analysts are expecting Unilever’s core operating margin to tick up to 14%, which means core operating profit would be pretty much unchanged from last year, despite the reported fall in revenue. We should be looking for core operating profit of a bit above €7bn.

Flat core operating profit filters down to core earnings, where the analyst consensus is for unchanged diluted EPS of €1.53.

Unilever is in the habit of paying four equal quarterly dividends a year. Shareholders have already received three payouts of €0.269 — or the sterling equivalent — and can look forward to another €0.269 being announced if the fourth-quarter dividend declaration goes according to script. The full-year payout would total €1.076 — a 10.7% increase on the €0.972 paid for 2012.

Outlook

Unilever issued an unscheduled trading statement after the markets closed on 30 September. The company reported seeing weakening in the market growth of many emerging countries during the third quarter and revised down its sales growth guidance for the period.

Nevertheless, emerging markets continue to be Unilever’s main driver of growth. Management repeated throughout last year that it had yet to see an improvement in market conditions in North America or Europe.

Shareholders should be looking to see whether the outlook statement in the upcoming results is more upbeat, more downbeat, or the same as last year’s, which was as follows:

“Markets will remain challenging, with intense competition and volatile commodity costs. We remain focused on achieving another year of profitable volume growth ahead of our markets, steady and sustainable core operating margin improvement and strong cash flow”.

Finally, I can tell you that Unilever is one of a select group of blue chips pinpointed as FTSE 100 winners for the future by the Motley Fool's top analysts.

You see, our analysts believe this group of elite companies will deliver superior long-term earnings and income growth. Such is their conviction about the quality of these businesses that they've called the report "5 Shares To Retire On".

This exclusive report comes with no obligation -- simply click here and it's yours.

G A Chester does not own any shares mentioned in this article. The Motley Fool owns shares in Unilever.